Mexican Auto Parts Avoid 25% U.S. Tariff After Sheinbaum Call

Following a call between President Claudia Sheinbaum and US President Donald Trump, it has been confirmed that planned tariffs on Mexican auto parts will not take effect. President Sheinbaum welcomed the decision announced by US Customs and Border Protection (CBP), which exempts auto parts manufactured in Mexico from the proposed 25% tariff.

The automotive industry, deeply integrated across the United States, Canada, and Mexico, has been heavily impacted by escalating trade tensions under Trump’s administration. In March, Trump announced a 25% tariff on imported vehicles and over 100 categories of auto parts, including engines and wheels. Imported vehicles with US-made components were expected to qualify for a preferential discount.

Additionally, the industry faced a separate 25% tariff on aluminum and steel. However, on Apr. 29, Trump clarified that certain auto parts would be exempt from the metals tariff. White House officials indicated that the exemption aims to give manufacturers more time to relocate operations to the United States.

According to the National Auto Parts Industry (INA), Mexico stood to lose up to US$24.1 billion if the tariffs were implemented. Mexico’s Minister of Economy, Marcelo Ebrard, announced during a morning press conference that Mexican-made auto parts will now be treated as if produced in the United States, noting the extensive cross-border integration of components like pistons and steering wheels, which often cross the border up to seven times during production.

President Sheinbaum emphasized the importance of the automotive sector, which she described as a US$70 billion industry. “This is very good news,” she stated. She also noted that during her conversation with Trump, they discussed the trade deficit between the two countries, and she committed to exploring ways to increase Mexico’s imports of US goods.